THE Department of Finance (DOF) said headline inflation likely picked up to 2.5 percent in October from 2.3 percent in September and 0.4 percent a year earlier, attributing the increase largely to the low comparative base in 2015.
“Just like last month, the apparent surge in inflation rate is the result of base effects. October last year registered an inflation rate of 0.4 percent,” Finance Undersecretary Gil Beltran said in a report.
The uptick would peg the 10-month inflation rate at 1.6 percent, still below the inter-agency Development Budget Coordination Committee (DBCC)’s target range of 2.0 percent to 4.0 percent.
“The benign inflation will continue to support economic growth” and brace the economy against external volatilities, Beltran said.
In October, index heavyweights non-alcoholic beverages and food are expected to show an increase to 3.3 percent from 3.1 percent, while prices of alcoholic beverages and tobacco could post growth of 6.5 percent from September’s 6.2 percent.
Also, prices of clothing and footwear may increase from 2.7 percent in September to 2.8 percent; furnishings, households equipment may jump from 2.3 percent to 2.4 percent; and recreation and culture from 1.7 percent to 1.8 percent, the Economic Bulletin submitted to Finance Secretary Carlos Dominguez 3rd said.
Housing, utilities and fuels could also increase from 0.9 percent to 1.1 percent this month; and transport from 0.2 percent to 0.6 percent.
Lastly, health (2.7 percent), restaurant and miscellaneous services (2.4 percent), education (1.8 percent), and communication (0.1 percent) are seen remaining at the previous month’s levels.
In the four weeks of October, Manila Electric Co.’s (Meralco) rate per kilowatt hour (kwh) for an average of 300 kilowatts-per-month consumption dipped to P8.65 from P8.77 in September and P8.74 a year earlier.
Meralco’s generation rate per kwh also fell to P3.89 during the month from P3.94 in September and P4 in the previous year.
Meanwhile, the average price of diesel in Metro Manila among the “big three” oil companies accelerated to
P28.04 per liter from P25.74 the previous month and P26.89 in October last year.
The average price of gasoline in the first four weeks of October also increased to P42.27 per liter from P37.83 in September and P41.7 a year earlier.
Beltran had said in an earlier economic bulletin that inflation was likely to remain above 2.0 percent in the short term owing to higher commodity costs, noting that core inflation rose at a faster rate from August to September, which he said signaled a possible spike in consumer prices in the coming months.